Has anyone had experience with the Foreign Housing Exclusion/Deduction that goes along with FEIE? I'm moving to London next month and I hear housing costs are insane there. Wondering if this additional exclusion makes FEIE better than FTC in high-cost cities?

Great question! I went through this exact same decision process when I moved back to the US after working in the UK for several years. One key point that hasn't been fully addressed: you mentioned having $13,500 in excess FTC from 2023 - those credits are gold! Since FTC carryovers last 10 years, you can absolutely use them on your 2025 return even though you used FEIE in 2024. This might actually make your decision easier since you'll get immediate benefit from those carried-forward credits. A few additional considerations for your situation: - If you're planning to stay in the US long-term, FTC might make more sense going forward since you won't qualify for FEIE as a US resident - State taxes: some states don't recognize FEIE but do recognize FTC, so if you're in a state with income tax, this could affect your calculation - Alternative Minimum Tax (AMT): FTC can sometimes trigger AMT issues, while FEIE generally doesn't Since you're back in the US for 2025, you probably won't have foreign earned income anyway, so the FEIE vs FTC decision might be moot for this year. Focus on maximizing the use of those carryover credits from 2023! The switching rules are exactly as others described - you can go from FTC to FEIE anytime, but once you revoke FEIE, there's that 5-year waiting period.

Are any of you using online tax prep software for your C-Corp returns when you actually file? I'm trying to figure out if I should just buy software now and use that to file the extension too, or if that's overkill for just an extension.

As someone who just went through this process last month, I'd strongly recommend e-filing your Form 7004 rather than mailing it, especially if you're cutting it close to the deadline. The IRS free e-file options for business extensions are actually pretty good now. One thing I wish I'd known earlier - even though you're bootstrapping, consider setting aside some cash for the estimated payment. I made the mistake of filing the extension without any payment thinking I could figure it out later, and ended up with interest charges that added up quickly. Even a rough estimate based on your projected profit is better than zero. Also, don't forget to check if your state requires a separate extension filing. Some states automatically extend when you file federal, but others don't. Since you mentioned you're a tech startup, depending on your state's business tax requirements, this could be important to avoid additional penalties. The whole process really doesn't have to be overwhelming - Form 7004 is much simpler than the actual tax return you'll file later!

Have you considered Short-Term Treasury Bills instead? They're yielding around 5.3-5.4% right now, and they have a tax advantage over HYSAs because they're exempt from state and local taxes. If you're in a high-tax state, this could give you a better after-tax return than a HYSA.

I'd echo what others have said about Treasury bills being worth considering. The state tax exemption can be a real advantage depending on where you live. One thing I haven't seen mentioned yet is considering a CD ladder as another option. Some banks are offering competitive rates on CDs (around 4.5-5.2%) with terms that could align with your 12-18 month timeline. While they don't have the state tax advantage of T-bills, they might offer slightly better liquidity planning since you can time the maturities exactly when you expect to need the funds. You could also look into money market accounts, which sometimes offer rates competitive with HYSAs but with check-writing privileges that might be useful during the home buying process when you need to move money quickly for earnest money deposits, inspections, etc. Given your substantial down payment amount ($325k), you might also want to consider spreading across multiple institutions to stay within FDIC limits if you go the HYSA route. Most banks have $250k FDIC coverage per depositor, so you'd want to split your funds to ensure full protection.

If this is your first time getting a CP2000, make sure you check if they calculated the taxes correctly. Last year they sent me one claiming I owed $4k, but when I looked closely I realized they had double-counted one of my 1099s. Sent in my explanation with documentation and they completely canceled the proposed amount. These notices aren't always accurate!

I went through something very similar last year and want to share what I learned. First, don't panic - these CP2000 notices are super common and usually straightforward to resolve. The key is to carefully review every line on the notice against your actual tax documents. In my case, the IRS had records of a small 1099-MISC that I had completely forgotten about from some freelance work I did. Once I found that document, everything made sense and I just had to pay the additional tax owed plus a small amount of interest. My advice: gather all your tax documents (W-2s, 1099s, bank statements, etc.) and go through them systematically. Look for anything that might match the income amounts the IRS is claiming you didn't report. Sometimes it's something really simple like a forgotten savings account interest statement or a small side job payment. If you find the missing income and the IRS calculation looks correct, it's usually easiest to just pay it. But if you genuinely can't find what they're referring to or you think they made an error, definitely respond with your documentation before the deadline. Don't let it slide - that's when penalties and interest really start to pile up.

Has anyone actually been audited over mileage? I've been a 1099 contractor for 6 years and honestly just guesstimate my miles. Never had any issues.

As someone who's been through the 1099 contractor maze myself (freelance graphic designer), I can confirm what others have said about the temporary work location rule being your friend here. The key distinction is that you don't have a "regular" workplace - you're bouncing between different client sites that are all temporary by nature. One thing I'd add that hasn't been mentioned yet: make sure you're also tracking any trips between job sites during the same day. If you go from your home to Site A, then to Site B, then back home, ALL of those miles are deductible business miles, not just the initial trip from home. Also, with 24,000 miles, you're looking at potentially $15,720 in deductions at the current rate (24,000 × $0.655). That's a huge amount to leave on the table! Definitely worth getting this sorted out properly. The documentation advice from @Ravi Sharma is spot on - I learned that lesson during a small audit a few years back. Better to over-document than under-document when it comes to the IRS.